Ruidoso settles Renegade contract issues

Councilors unhappy, but relent on pipe issue

By Dianne Stallings

dstallings@ruidosonews.com @RuidosoNews on Twitter

Posted:
08/20/2013 03:57:34 PM MDT

The contract settlement between Renegade Construction LLC and the Ruidoso Village Council will not contain an adjustment for a different pipe size used on the Carrizo Creek diversion to Grindstone Reservoir and its associated treatment plant and storage tanks.

Councilors last week approved Change Order No. 3, which decreased the contract by $33,496 and added 26 days to the completion date, moving the date to Aug. 30, for the final close-out of the project.

Community Development Director Bobby Rose said five items were removed from the contract, adding up to the total. They were burying a pipe at the top of the stream bank, furnishing and installing a pump vault, furnishing and installing wire pumps and piping, static pressure test pipe for leaks and a test pump system.

"This will set them up for the final close-out," she told councilors.

"There is no enumeration for the pipe," Mayor Ray Alborn pointed out, referring to the fact that a smaller pipe was used in the project than originally specified. The former village utilities director contended the scope of work required a performance compliance and was not tied to a specific size of pipe, but councilors were bothered by the change and what one competitor for the bid claimed was a $50,000 difference in pipe price.

"Could that be coming down the road?" Alborn asked.

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Rose replied if the council wants to fight for that reimbursement, she follows directives and will try. But Village Manager Debi Lee interjected that the village doesn't have a strong legal case.

"We have met and Councilor (Joseph) Eby has attended those, and it is an issue we have looked at," she said. "The change in the pipe was authorized by the village engineer," she said. "However, that was after the fact, after the bid. (Renegade was) one of the higher on comparison of the pipe item. They claim there is no money to give back. We have asked them to give us that in writing."

Eby said most of the councilors felt there was a discrepancy between what was bid and what was delivered, "I would like to see a positive conclusion for the village, but unfortunately, when you read the contract, that particular section gives the (engineer) power to determine and decide changes. With the signature on that submittal, according to our attorney, we are pretty much over a legal barrel in that sense," Eby said. "I've also asked the question if we should go forward to seek liquidated damages, but in the end, the village will end up (not coming out ahead financially) trying to get the $500 a day, because of the delay of the project moving forward. So as distasteful as it may seem, it is time some times to accept and bite the bullet."

Councilor Gloria Sayers asked to ensure the situation isn't repeated, what could be done in procurement to use better forms and contracts.

"We have spent a lot of time on this issue and (staff has) already corrected it," Lee said. "The answer is don't use in-house engineers and staffing

to write specifications and plans. We're just not equipped to do that. When you use a qualified engineer (you receive) a clean scope of work and specifications, That didn't happen with this project."

"We should learn from that," Councilor Jim Stoddard said, No one, including the purchasing department or a designated professional individual should have authority to put the village into the position in which the council found itself on the Renegade project, he said. "We need to learn from that and write that into purchasing," he said. "If we see that it is (an emergency), it's a red flag and it comes to the attorney and the council, call a special meeting, if needed. Statements by a former employee that it was an emergency put us in a bind more than once."

Sayers added that every contract should specify liquidated damages for failure to meet deadlines on specifications.